819.52G31/19: Telegram

The Chargé in Panama ( Flexer ) to the Secretary of State

53. Following are the Legation’s comments on lettered paragraphs Department’s telegram No. 25, June 22, noon:

(a)
It would be preferable that negotiations be conducted directly between Elliott and Department Commander in Panama where negotiators are acquainted and situation is mutually understood. The Department Commander is telegraphing the Commanding General, Second Corps Area, to confirm that Elliott will return to Panama before expiration 3 weeks limit offered by Wallenberg June 17.
(b)
While company’s representative in Panama states that he has full power of attorney, it is obvious from conversations that he could not commit company to agreement without communicating with Elliott or Stockholm.
(c)
I believe General Stone’s recommendation to War Department of annual rental of $2,300, representing 6% interest on acceptable German offer plus allowance for taxes, to be equitable provided that there is genuine intent to exercise purchase option at $35,000 on or before expiration of period of lease. Company’s representative is personally skeptical of interest in a lease but it is believed that Elliott can be won over by definite assurance that purchase option will be exercised. Terms should be left to local negotiations.

Flexer